SEC Filing | Labcorp

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended JUNE 30, 2000 ----------------------------------- OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to --------------- --------------- Commission file number 1-11353 ------------------------------------------- LABORATORY CORPORATION OF AMERICA HOLDINGS - ------------------------------------------------------------------- (Exact name of registrant as specified in its charter) DELAWARE 13-3757370 - ------------------------------------------------------------------- (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 358 SOUTH MAIN STREET, BURLINGTON, NORTH CAROLINA 27215 - ------------------------------------------------------------------- (Address of principal executive offices) (Zip code) (336) 229-1127 - ------------------------------------------------------------------- (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes X No ___ The number of shares outstanding of the issuer's common stock is 34,369,515 shares as of July 31, 2000, of which 14,120,466 shares are held by indirect wholly owned subsidiaries of Roche Holding Ltd.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) JUNE 30, DECEMBER 31, 2000 1999 ------------ ------------- ASSETS Current assets: Cash and cash equivalents $ 59.2 $ 40.3 Accounts receivable, net 372.7 348.0 Inventories 30.6 29.1 Prepaid expenses and other 19.8 37.5 Deferred income taxes 46.7 44.6 -------- -------- Total current assets 529.0 499.5 Property, plant and equipment, net 272.4 273.2 Intangible assets, net 813.7 803.9 Other assets, net 18.2 13.6 -------- -------- $1,633.3 $1,590.2 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 51.0 $ 43.6 Accrued expenses and other 135.4 107.0 Current portion of long-term debt 110.0 95.0 -------- -------- Total current liabilities 296.4 245.6 Revolving credit facility -- -- Long-term debt, less current portion 412.5 478.4 Capital lease obligations 7.5 4.4 Other liabilities 127.5 127.6 Commitments and contingent liabilities -- -- Mandatorily redeemable preferred stock (30,000,000 shares authorized): Series A 8 1/2% Convertible Exchangeable Preferred Stock, $0.10 par value, 1,884,476 and 4,363,178 shares issued and outstanding at June 30, 2000 and December 31, 1999 respectively (aggregate preference value of $94.2 and 218.2 at June 30, 2000 and December 31, 1999 respectively) 95.2 213.4 Series B 8 1/2% Convertible Pay-in-Kind Preferred Stock, $0.10 par value, 6,901,238 and 6,971,970 shares issued and outstanding at June 30, 2000 and December 31, 1999 respectively (aggregate preference value of $345.1 and $348.6, respectively) 350.8 345.3 Shareholders' equity: Common stock, $0.10 par value; 52,000,000 shares authorized; 18,331,457 and 12,878,958 shares issued and outstanding at June 30, 2000 and December 31, 1999, respectively 1.8 1.3 Additional paid-in capital 570.8 423.9 Accumulated deficit (221.7) (245.5) Unearned restricted stock compensation (7.2) (4.1) Accumulated other comprehensive loss (0.3) (0.1) -------- -------- Total shareholders' equity 343.4 175.5 -------- -------- $1,633.3 $1,590.2 ======== ======== The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) SIX MONTHS ENDED THREE MONTHS ENDED JUNE 30, JUNE 30, ----------------- ------------------ 2000 1999 2000 1999 -------- ------- ------- ------- Net sales $ 945.1 $ 847.4 $ 482.4 $ 429.5 Cost of sales 560.4 531.7 281.2 265.2 ------- ------- ------- ------- Gross profit 384.7 315.7 201.2 164.3 Selling, general and administrative expenses 240.5 223.5 122.1 114.4 Amortization of intangibles and other assets 15.5 15.7 7.8 7.8 ------- ------- ------- ------- Operating income 128.7 76.5 71.3 42.1 Other income (expenses): Loss on sale of assets (0.8) (1.2) (0.5) -- Investment income (loss) 0.1 0.4 (0.9) 0.2 Interest expense (19.8) (20.9) (9.3) (10.3) ------- ------- ------- ------- Earnings before income taxes 108.2 54.8 60.6 32.0 Provision for income taxes 49.8 20.8 27.9 12.2 ------- ------- ------- ------- Net earnings 58.4 34.0 32.7 19.8 Less preferred stock dividends 34.4 23.5 19.6 12.5 Less accretion of mandatorily redeemable preferred stock 0.2 0.5 0.1 0.2 ------- ------- ------- ------- Net earnings attributable to common shareholders $ 23.8 $ 10.0 $ 13.0 $ 7.1 ======= ======= ======= ======= Basic earnings per common share $ 1.83 $ 0.79 $ 0.97 $ 0.56 ======== ======== ======== ======== Diluted earnings per common share $ 1.71 $ 0.79 $ 0.94 $ 0.56 ======== ======== ======== ======== The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) SIX MONTHS ENDED JUNE 30, ------------------- 2000 1999 ------- ------- CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings $ 58.4 $ 34.0 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 43.4 42.6 Amortization of deferred compensation 1.0 -- Net losses on sale of assets 0.8 1.2 Deferred income taxes (0.6) (2.9) Change in assets and liabilities: Increase in accounts receivable, net (23.9) (1.1) (Increase)decrease in inventories (0.9) 2.5 Decrease (increase) in prepaid expenses and other 17.8 (2.8) Increase (decrease) in accounts payable 7.1 (2.3) Increase in accrued expenses and other 29.6 6.6 Other, net (2.8) (1.9) ------- ------- Net cash provided by operating activities 129.9 75.9 ------- ------- CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (26.1) (36.9) Proceeds from sale of assets 0.8 0.7 Acquisition of businesses (28.5) -- ------- ------- Net cash used for investing activities (53.8) (36.2) ------- ------- (continued)

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) SIX MONTHS ENDED JUNE 30, ----------------- 2000 1999 ------- ------ CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from revolving credit facilities -- 30.0 Payments on revolving credit facilities -- (10.0) Payments on long-term debt (51.0) (48.0) Payments on long-term lease obligations (0.5) (0.6) Deferred payments on acquisitions -- (8.7) Payment of preferred stock dividends (9.5) (9.3) Net proceeds from issuance of stock to employees 4.0 1.3 ------ ------ Net cash used for financing activities (57.0) (45.3) ------ ------ Effect of exchange rate changes on cash and cash equivalents (0.2) (0.2) Net increase (decrease) in cash and cash equivalents 18.9 (5.8) Cash and cash equivalents at beginning of period 40.3 22.7 ------ ------ Cash and cash equivalents at end of period $ 59.2 $ 16.9 ====== ====== Supplemental schedule of cash flow information: Cash paid during the period for: Interest $ 22.3 $ 23.4 Income taxes, net of refunds 12.4 18.9 Disclosure of non-cash financing and investing activities: Preferred stock dividends 24.9 14.2 Accretion of mandatorily redeemable preferred stock 0.2 0.5 Unrealized loss on securities available- for-sale (net of tax) -- (0.4) Conversion of preferred stock into common stock 137.8 -- The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) Additional Common Paid-in Accumulated Stock Capital Deficit ------- ---------- ----------- PERIOD ENDED JUNE 30, 1999 Balance at beginning of year $ 1.2 $ 415.7 $ (260.5) Comprehensive income: Net earnings -- -- 34.0 Other comprehensive income: Foreign currency translation adjustments -- -- -- Unrealized loss on securities, net of tax -- -- -- ------- -------- --------- Comprehensive income -- -- 34.0 Issuance of common stock -- 1.3 -- Preferred stock dividends -- -- (23.5) Accretion of mandatorily redeemable preferred stock -- -- (0.5) ------- -------- --------- BALANCE AT JUNE 30, 1999 $ 1.2 $ 417.0 $ (250.5) ======= ======== ========= PERIOD ENDED JUNE 30, 2000 Balance at beginning of year $ 1.3 $ 423.9 $ (245.5) Comprehensive income: Net earnings -- -- 58.4 Other comprehensive income: Foreign currency translation adjustments -- -- -- Change in valuation allowance on securities, net of tax -- -- -- ------- -------- --------- Comprehensive income -- -- 58.4 Issuance of common stock -- 4.0 -- Issuance of restricted stock awards -- 4.1 -- Amortization of unearned restricted stock compensation -- -- -- Income tax benefit from stock options exercised -- 1.5 -- Conversion of preferred stock into common stock 0.5 137.3 -- Preferred stock dividends -- -- (34.4) Accretion of mandatorily redeemable preferred stock -- -- (0.2) ------ ------- -------- BALANCE AT JUNE 30, 2000 $ 1.8 $ 570.8 $ (221.7) ====== ======= ========

Unearned Accumulated Restricted Other Total Stock Comprehensive Shareholders' Compensation Loss Equity -------------- ------------- ------------ PERIOD ENDED JUNE 30, 1999 Balance at beginning of year $ -- $ (2.0) $ 154.4 Comprehensive income: Net earnings -- -- 34.0 Other comprehensive income: Foreign currency translation adjustments -- (0.2) (0.2) Unrealized loss on securities, net of tax -- (0.4) (0.4) ------ ------ --------- Comprehensive income -- (0.6) 33.4 Issuance of common stock -- -- 1.3 Preferred stock dividends -- -- (23.5) Accretion of mandatorily redeemable preferred stock -- -- (0.5) ------ ------ --------- BALANCE AT JUNE 30, 1999 $ -- $ (2.6) $ 165.1 ====== ======= ========= PERIOD ENDED JUNE 30, 2000 Balance at beginning of year $ (4.1) $ (0.1) $ 175.5 Comprehensive income: Net earnings -- -- 58.4 Other comprehensive income: Foreign currency translation adjustments -- (0.2) (0.2) Change in valuation allowance on securities, net of tax -- -- -- ------ ------ ------ Comprehensive income -- (0.2) 58.2 Issuance of common stock -- -- 4.0 Issuance of restricted stock awards (4.1) -- -- Amortization of unearned restricted stock compensation 1.0 -- 1.0 Income tax benefit from stock options exercised -- -- 1.5 Conversion of preferred stock into common stock -- -- 137.8 Preferred stock dividends -- -- (34.4) Accretion of mandatorily redeemable preferred stock -- -- (0.2) ------ ------ ------- BALANCE AT JUNE 30, 2000 $ (7.2) $ (0.3) $ 343.4 ====== ====== ======= The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) 1. BASIS OF FINANCIAL STATEMENT PRESENTATION The condensed consolidated financial statements include the accounts of Laboratory Corporation of America Holdings and its wholly owned subsidiaries (the "Company") after elimination of all material intercompany accounts and transactions. The financial statements of the Company's foreign subsidiary are measured using the local currency as the functional currency. Assets and liabilities are translated at exchange rates as of the balance sheet date. Revenues and expenses are translated at average monthly exchange rates prevailing during the year. Resulting translation adjustments are included in "Accumulated other comprehensive loss." The accompanying condensed consolidated financial statements of the Company are unaudited. In the opinion of management, all adjustments (which include only normal recurring accruals) necessary for a fair presentation of such financial statements have been included. Interim results are not necessarily indicative of results for a full year. The financial statements and notes are presented in accordance with the rules and regulations of the Securities and Exchange Commission and do not contain certain information included in the Company's annual report. Therefore, the interim statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company's annual report. 2. MANDATORILY REDEEMABLE PREFERRED STOCK In May 1997, the Company's Board of Directors declared a dividend of 10,000,000 transferable subscription rights which were then issued pro rata to holders of its common stock entitling them to purchase up to an aggregate of $500.0 of redeemable preferred stock issuable in two series at a subscription price of $50 per share. The subscription period ended in June 1997 and at that time, rights were exercised to purchase 4,363,202 shares of Series A 8 1/2% Convertible Exchangeable Preferred Stock and 5,636,798 shares of Series B 8 1/2% Convertible Pay-in-Kind Preferred Stock, each at a subscription price of $50 per share. On June 6, 2000, the Company called for redemption all of its outstanding Series A and Series B preferred stock at $52.83 per share, in accordance with the terms of the Preferred Stock Offering, by July 6, 2000. Substantially all of the holders of the Series A and Series B preferred stock elected to convert their shares into common stock. As of July 31, 2000, the Series A preferred stock was converted into 7,930,174 shares of common stock and the Series B preferred stock was converted into 13,241,576 shares of common stock, increasing shareholders' equity by approximately $446 from the balance at June 30, 2000. 3. BUSINESS ACQUISITIONS During June, the Company completed the acquisition of the laboratory testing business of San Diego-based Pathology Medical Laboratories for approximately $14.5 in cash.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) At the end of July 2000, the Company completed the acquisition of all of the stock of National Genetics Institute, Inc. (NGI), which is based in Los Angeles, California, for approximately $56.0 in cash. The purchase agreement provides for additional payments of up to $16.0, contingent upon realization of certain specified revenue targets by NGI. NGI revenues for the past twelve months approximated $28.0. 4. EARNINGS PER SHARE Basic earnings per share is computed by dividing net income, less preferred stock dividends, by the weighted average number of common shares outstanding. Dilutive earnings per share is computed by dividing net income, by the weighted average number of common shares outstanding plus potentially dilutive shares, as if they had been issued at the beginning of the period presented. Potentially dilutive common shares result primarily from the Company's mandatorily redeemable preferred stock, restricted stock awards and outstanding stock options. The following represents a reconciliation of the weighted average shares used in the calculation of basic and diluted earnings per share: Three months Six months Ended June 30, Ended June 30, ---------------- ---------------- 2000 1999 2000 1999 ------- ------ ------ ------ Basic 13,331 12,626 13,043 12,620 Assumed conversion/exercise of: Stock options 302 -- 259 -- Restricted stock awards 166 -- 165 -- Series A preferred stock 7,933 -- 7,933 -- Series B preferred Stock 12,949 -- 12,813 -- ------ ------ ------ ------ Diluted 34,681 12,626 34,213 12,620 The effect of conversion of the Company's redeemable preferred stock, or exercise of the Company's stock options or restricted stock awards was not included in the computation of diluted earnings per common share for the three- and six-months ended June 30, 1999, as it would have been antidilutive. The following table summarizes the potential common shares not included in the computation of diluted earnings per share, because their impact would have been antidilutive:

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) JUNE 30, JUNE 30, ----------------------- 2000 1999 --------- --------- Stock options 236,041 1,058,209 Series A convertible exchangeable preferred stock -- 7,933,043 Series B convertible pay-in-kind preferred stock -- 12,154,257 5. RESTRUCTURING CHARGES The following represents the Company's restructuring activities for the period indicated: Total ----- Balance at December 31, 1999 $ 26.8 Cash payments (2.2) Reclassifications and non-cash items (3.7) ------ Balance at June 30, 2000 $ 20.9 ====== Current $ 11.0 Non-current 9.9 ------ $ 20.9 ====== Reclassifications and non-cash items relate to changes in certain long- term capital lease obligations. 6. INTEREST RATE SWAP The existing rate collar transaction and swap have effectively changed the interest exposure on $500.0 of floating rate debt to a weighted-average fixed interest rate of 6.17%. The notional amounts of the agreements are used to measure interest to be paid or received and do not represent the amount of exposure to credit loss. 7. LONG-TERM DEBT On June 30, 2000, the Company made a scheduled payment of approximately $22.0 on its term loan facility. The Fourth Amendment to the Amended and Restated Credit Agreement became effective on June 7, 2000. This amendment permitted the Company to redeem preferred stock in cash (if necessary) and increased the amount allowed for acquisitions from $75.0 to $200.0 on a rolling twelve-month basis.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) 8. INCOME TAXES As discussed in the Company's 1999 Annual Report, footnote 10, the Company had recorded a $17.4 net income tax refund receivable, along with related interest receivable, in prepaid expenses and other. The refund was based upon receipt of two Revenue Agents Reports, which concluded the audits of the tax years ended 1993 through 1997. While the refund was being reviewed by Joint Committee, the IRS reversed its position on certain aspects of the amended returns for the years in question. The Company has decided not to contest the IRS' position and has reclassified the $17.4 receivable to deferred income taxes as a net operating loss carryforward ("NOL") in the second quarter. As of June 30, 2000, the NOL has been fully-utilized to reduce the Company's income tax liability for 1999 and 2000. 9. STOCK COMPENSATION PLANS During June 2000, the Company adopted the 2000 Stock Incentive Plan, reserving 1,700,000 shares of common stock (plus any shares remaining available for grant under the Amended and Restated 1999 Stock Incentive Plan and the 1994 Stock Option Plan) for issuance pursuant to options, rights, restricted shares and performance awards. Effective June 16, 1999, the Company's shareholders approved the issuance of shares of Common Stock to key employees under a restricted stock plan. During 2000 and 1999, 82,550 and 162,000 shares have been issued under this plan, respectively. Restrictions limit the sale or transfer of these shares during a six-year period when the restrictions lapse. Upon issuance of stock under the plan, unearned compensation equivalent to the market value at the date of grant is charged to shareholders' equity as unearned restricted stock compensation and subsequently amortized to expense over the six-year vesting period. The plan provides for accelerated vesting of outstanding shares in percentages of 33.3%, 66.7% or 100%, if certain predefined profitability targets are achieved as of December 31, 2001 for the shares issued in 1999 and as of December 31, 2002 for the shares issued in 2000. The tax benefits associated with the exercise of non-qualified stock options reduces taxes currently payable by $1.5 for the six months ended June 30, 2000. Such benefits are credited to additional paid-in-capital. 10. COMMITMENTS AND CONTINGENCIES The Company is involved in two litigations which purport to be class actions brought on behalf of certain patients, private insurers and benefit plans that paid for laboratory testing services during the time frame covered by the 1996 Government Settlement. The Company has also received certain similar claims brought on behalf of certain other insurance companies, some of which have been resolved for immaterial amounts. These claims for private reimbursement are similar to the government claims settled in 1996. However, no amount of damages has been specified at this time and, with the exception of the above, no material settlement agreements have been reached. The Company is carefully evaluating these claims. However, due to the early stage

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) of the claims, the ultimate outcome of these claims cannot presently be predicted. The Company is also involved in certain claims and legal actions arising in the ordinary course of business. These matters include, but are not limited to, professional liability, employee-related matters, inquiries from governmental agencies and Medicare or Medicaid carriers requesting comment on allegations of billing irregularities that have been brought to their attention through billing audits or third parties. In the opinion of management, based upon the advice of counsel and consideration of all facts available at this time, the ultimate disposition of these matters is not expected to have a material adverse effect on the financial position, results of operations or liquidity of the Company. The Company believes that it is in compliance in all material respects with all statutes, regulations and other requirements applicable to its clinical laboratory operations. The clinical laboratory testing industry is, however, subject to extensive regulation, and many of these statutes and regulations have not been interpreted by the courts. There can be no assurance therefore that applicable statutes and regulations might not be interpreted or applied by a prosecutorial, regulatory or judicial authority in a manner that would adversely affect the Company. Potential sanctions for violation of these statutes and regulations included significant fines and the loss of various licenses, certificates and authorizations. 11. NEW ACCOUNTING PRONOUNCEMENTS In June 2000, Statement of Financial Accounting Standards (FAS) No. 138, "Accounting for Certain Derivative Instruments and Certain Hedging Activities," was issued. This Statement amends certain paragraphs of FAS No. 133 which standardized the accounting for derivative instruments by requiring that an entity recognize those items as assets or liabilities and measure them at fair value. Adoption is required for the quarter ending September 30, 2000, and is not expected to have a material impact on the Company's financial position or results of operations. In December 1999, the SEC issued its Staff Accounting Bulletin 101, "Revenue Recognition in Financial Statements". This Bulletin, along with its amendments (101A and 101B), establishes the SEC staff's specific criteria for the recognition of revenue. Adoption is required no later than the fourth fiscal quarter of fiscal years beginning after December 15, 1999, and is not expected to have a material impact on the Company's financial position or results of operations. OVERVIEW This quarterly report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, from time to time, the Company or its representatives have made or may make forward-looking statements, orally or in writing. Such forward- looking statements may be included in, but are not limited to, various filings made by the Company with the Securities and Exchange Commission, press

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) releases or oral statements made by or with the approval of an authorized executive officer of the Company. Actual results could differ materially from those projected or suggested in any forward-looking statements as a result of a wide variety of factors and conditions, which have been described in the section of the Company's Annual Report on Form 10-K for the year ended December 31, 1999, entitled, "Cautionary Statement for Purposes of the `Safe Harbor' Provisions of the Private Securities Litigation Reform Act of 1995" and other documents the Company files from time to time with the Securities and Exchange Commission including the Company's quarterly reports on Form 10-Q and current reports on Form 8-K, and shareholders are specifically referred to these documents with regard to factors and conditions that may affect future results. RESULTS OF OPERATIONS Three Months ended June 30, 2000 compared with Three Months ended June 30, 1999 Net sales for the three months ended June 30, 2000 were $482.4, an increase of approximately 12.3% from $429.5 for the comparable 1999 period. The sales increase is a result of a 9.2% increase in volume and a 3.1% increase in price. The increase in sales for the second quarter of 2000 would have been approximately 11.5% after excluding the effect of the three acquisitions made in 2000 (POISONLAB, Inc., Bio-Diagnostics Laboratories and Pathology Medical Laboratories). Cost of sales, which includes primarily laboratory and distribution costs, was $281.2 for the three months ended June 30, 2000 compared to $265.2 in the corresponding 1999 period, an increase of $16.0. Cost of sales increased $23.9 due to the increase in volume which was offset by margin improvements totaling $8.7 in salaries and benefits, supplies and depreciation expenses. Cost of sales as a percentage of net sales was 58.3% for the three months ended June 30, 2000 and 61.7% in the corresponding 1999 period. The decrease in the cost of sales percentage of net sales primarily resulted from the Company's continued cost reduction efforts and cost efficiencies related to increased volume. Selling, general and administrative expenses increased to $122.1 for the three months ended June 30, 2000 from $114.4 in the same period in 1999. The primary reason for the increase is due to an increase in personnel costs, primarily in the area of incentive-based compensation. As a percentage of net sales, selling, general and administrative expenses were 25.3% and 26.6% for the three months ended June 30, 2000 and 1999, respectively. The amortization of intangibles and other assets was $7.8 for the three months ended June 30, 2000 and 1999. Interest expense was $9.3 for the three months ended June 30, 2000 compared with $10.3 for the same period in 1999. The decline in interest expense is a result of the Company's reduction in long-term debt and lower interest rates. The provision for income taxes as a percentage of earnings before taxes

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) was 46.0% for the tree months ended June 30, 2000 compared to 38.0% for the three months ended June 30, 1999. During the three months ended June 30, 1999, the Company reduced its valuation allowance applied against its deferred tax assets by $2.5, thereby reducing its provision for income taxes as a percentage of earnings before taxes by approximately 8 percentage points. The reduction in the effective rate, before consideration of the 1999 valuation allowance reduction, is related to increased earnings before taxes and the reduced impact that non deductible goodwill has on the effective tax rate. SIX MONTHS ENDED JUNE 30, 2000 COMPARED WITH SIX MONTHS ENDED JUNE 30, 1999 Net sales for the six months ended June 30, 2000 were $945.1, an increase of approximately 11.5% from $847.4 reported in the comparable 1999 period. The sales increase is a result of an 8.6% increase in volume and a 2.9% increase in price. The increase in sales for the for the six months ended June 30, 2000 would have been approximately 11.0% after excluding the effect of the three acquisitions made in 2000 (POISONLAB, Inc., Bio-Diagnostics Laboratories and Pathology Medical Laboratories). Cost of sales, which includes primarily laboratory and distribution costs, was $560.4 for the six months ended June 30, 2000 compared to $531.7 in the corresponding 1999 period, an increase of $28.7. Cost of sales increased approximately $45.2 due to the increase in volume which was offset by margin improvements totaling $19.4 in salaries and benefits and supplies. Cost of sales as a percentage of net sales was 59.3% for the six months ended June 30, 2000 and 62.7% in the corresponding 1999 period. The decrease in the cost of sales percentage of net sales primarily resulted from the Company's continued cost reduction efforts and cost efficiencies related to increased volume. Selling, general and administrative expenses increased to $240.5 for the six months ended June 30, 2000 from $223.5 in the same period in 1999. The primary reason for the increase is due to an increase in personnel costs, primarily in the area of incentive-based compensation. As a percentage of net sales, selling, general and administrative expenses were 25.5% and 26.4% for the six months ended June 30, 2000 and 1999, respectively. The amortization of intangibles and other assets was $15.5 and $15.7 for the six months ended June 30, 2000 and 1999, respectively. Net interest expense was $19.8 for the six months ended June 30, 2000 compared with $20.9 for the same period in 1999. The provision for income taxes as a percentage of earnings before taxes was 46.0% for the six months ended June 30, 2000 compared to 38.0% for the six months ended June 30, 1999. During the six months ended June 30, 1999, the Company reduced its valuation allowance applied against its deferred tax assets by $5.0, thereby reducing its provision for income taxes as a percentage of earnings before taxes by approximately 9 percentage points. The reduction in the effective rate, before consideration of the 1999 valuation allowance reduction, is related to increased earnings before taxes and the reduced impact that non deductible goodwill has on the effective tax rate.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) LIQUIDITY AND CAPITAL RESOURCES Net cash provided by operating activities was $129.9 and $75.9 for the six months ended June 30, 2000 and June 30, 1999, respectively. The increase in cash flow from operations primarily resulted from improved earnings and increases in accounts payable and accrued expenses offset by increases in accounts receivable. Capital expenditures were $26.1 and $36.9 for the first six months of 2000 and 1999, respectively. The Company's days sales outstanding (DSO) at June 30, 2000 was 70 days, compared to 72 days at the end of the first quarter. Since June 1999, the Company has reduced its DSO by a total of 9 days and as of June 30, 2000, 70% of total revenues are currently being processed on the Company's centralized billing system. For a discussion of legal proceedings which may impact the Company's liquidity and capital resources see "Note 10 to the Company's Unaudited Condensed Consolidated Financial Statements". Cash and cash equivalents on hand, cash flows from operations and additional borrowing capabilities under the Amended Revolving Credit Facility are expected to be sufficient to meet anticipated operating requirements and provide funds for capital expenditures, potential acquisitions and working capital for the foreseeable future.

LABORATORY CORPORATION OF AMERICA HOLDINGS AND SUBSIDIARIES PART II - OTHER INFORMATION Item 1. Legal Proceedings See "Note 10 to the Company's Unaudited Condensed Consolidated Financial Statements" for the six months ended June 30, 2000 Item 4. REPORT OF THE INSPECTOR OF ELECTION On May 2, 2000 the Company held its 2000 annual meeting. The final tabulation of the votes cast at the meeting was as follows: FOR WITHHELD ---------- -------- ELECTION OF THE MEMBERS OF THE BOARD OF DIRECTORS: Thomas P. Mac Mahon 81,734,419 123,635 James B. Powell, MD 81,732,562 125,492 Jean-Luc Belingard 81,734,419 123,635 Wendy E. Lane 81,734,419 123,635 Robert E. Mittelstaedt, Jr 81,734,419 123,635 David B. Skinner, MD 81,734,419 123,635 Andrew G. Wallace, MD 81,734,419 123,635 VOTES VOTES VOTES FOR AGAINST ABSTAINED ---------- ---------- --------- APPROVAL OF THE LABORATORY CORPORATION OF AMERICA HOLDINGS 2000 STOCK INCENTIVE PLAN 80,475,144 1,343,219 39,691 APPROVAL OF AMENDMENTS TO THE LABORATORY CORPORATION OF AMERICA HOLDINGS CERTIFICATE OF INCORPORATION (the reverse stock split): 80,697,083 1,143,382 17,589 RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS THE COMPANY'S INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING DECEMBER 31, 2000 81,743,410 83,608 31,036 In addition, certain shares of National Health Laboratories Holdings, Inc. which have not been converted to Company shares were eligible to vote at the annual meeting and were voted as follows:

Item 4. REPORT OF THE INSPECTOR OF ELECTION - Continued FOR WITHHELD --- -------- ELECTION OF THE MEMBERS OF THE BOARD OF DIRECTORS: Thomas P. Mac Mahon 0 155 James B. Powell, MD 0 155 Jean-Luc Belingard 0 155 Wendy E. Lane 0 155 Robert E. Mittelstaedt, Jr. 0 155 David B. Skinner, MD 0 155 Andrew G. Wallace, MD 0 155 VOTES VOTES VOTES FOR AGAINST ABSTAINED ----- ------- --------- APPROVAL OF THE LABORATORY CORPORATION OF AMERICA HOLDINGS 2000 STOCK INCENTIVE PLAN 5 150 0 APPROVAL OF AMENDMENTS TO THE LABORATORY CORPORATION OF AMERICA HOLDINGS CERTIFICATE OF INCORPORATION (the reverse stock split) 5 150 0 RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS THE COMPANY'S INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING DECEMBER 31, 2000 155 0 0 Item 6. Exhibits and Reports on Form 8-K (a) Exhibits 3.1 Proposed Certificate of Amendment to the Certificate of Incorporation of Laboratory Corporation of America Holdings (incorporated by reference herein to Annex II of the Company's 2000 Annual Proxy Statement filed with the Commission on April 7, 2000). 10.1 Fourth Amendment to the Amended and Restated Credit Agreement dated as ofJune 7, 2000 among the Company, the banks named therein and Credit Suisse First Boston as Administrative Agent. 10.2 Laboratory Corporation of America Holdings 2000 Stock Incentive Plan (incorporated by reference herein to Annex I of the Company's 2000 Annual Proxy Statement filed with the Commission on April 7, 2000). 27 Financial Data Schedule (electronically filed version only).

Exhibits and Reports on Form 8-K (continued) (b) Reports on Form 8-K (1) A current report on Form 8-K dated May 4, 2000 was filed on May 23 ,2000, by the registrant, in connection with the press release dated May 4, 2000 announcing that the Company entered into a definitive agreement with San Diego-based Pathology Medical Laboratories (PML) to acquire PML's laboratory testing business. (2) A current report on Form 8-K/A dated June 6, 2000 was filed on June 7, 2000, by the registrant, in connection with the press release dated June 6, 2000 amending Item 7 of its Current Report on Form 8-K (Date of Report: May 2, 2000) to include five years of selected financial data as affected by the 1-for-10 reverse stock split. (3) A current report on Form 8-K dated June 6, 2000 was filed on June 7, 2000, by the registrant, in connection with the press release dated June 6, 2000 announcing that the Company has called for redemption on July 7, 2000 all of its outstanding 8 1/2 percent Series A Convertible Exchangeable Preferred Stock and 8 1/2 percent Series B Convertible Pay-in-Kind Preferred Stock. (4) A current report on Form 8-K dated June 8, 2000 was filed on June 12, 2000, by the registrant,in connection with the press release dated June 8, 2000 announcing that the Company's Board of Directors has declared a dividend of $0.08264 per share on its Series A Preferred Stock, payable in cash. The Board also declared a dividend of $0.08264 per share on the Company's Series B Preferred Stock at the rate of 0.001653 shares per share of Series B Preferred Stock held. The dividends will cover the seven days to July 7, 2000, the date set for redemption of the Series A and B Preferred Stock and will be paid in addition to the quarterly dividends payable on June 30, 2000. (5) A current report on Form 8-K dated June 12, 2000 was filed on June 26, 2000, by the registrant, in connection with the press release dated June 12, 2000 announcing that the Company can now support clinical trials in Latin America with routine safety testing through the Company's standardized laboratory in Miami.

(b) Reports on Form 8-K (continued) (6) A current report on Form 8-K dated June 12, 2000 was filed on June 26, 2000, by the registrant, in connection with the press release dated June 12, 2000 announcing that the Company's clinical trials testing division is expanding its established genetic testing capabilities to offer pharmacogenomic services to pharmaceutical and biotechnology companies. (7) A current report on Form 8-K dated June 20, 2000 was filed on June 26, 2000, by the registrant, in connection with the press release dated June 20, 2000 announcing that the Company has entered into a definitive agreement with privately-held National Genetics Institute, Inc. (NGI) to acquire all of the stock of NGI. Established in 1991, Los Angeles-based NGI is a leading national provider of hepatitis C testing using innovative molecular diagnostic technology. (8) A current report on Form 8-K dated July 13, 2000 was filed on July 25, 2000, by the registrant, in connection with the press release dated July 13, 2000 announcing that more than 99.97 percent of the shares of its outstanding 8 1/2 percent Series A Convertible Exchangeable Preferred Stock and 8 1/2 percent Series B Convertible Pay-in-Kind Preferred Stock called for redemption have been converted into the Company's common stock at the request of the preferred shareholders. (9) A current report on Form 8-K dated July 19, 2000 was filed on July 25, 2000, by the registrant, in connection with the press release dated July 19, 2000 announcing the results for the quarter and six months ended June 30, 2000. (10) A current report on Form 8-K dated June 27, 2000 was filed on August 10, 2000, by the registrant, in connection with the press release dated June 27, 2000 announcing that it has completed its acquisition of the laboratory testing business of San Diego-based Pathology Medical Laboratories. Terms of the acquisition were not disclosed. (11) A current report on Form 8-K dated August 1, 2000 was filed on August 10, 2000, by the registrant, in connection with the press release dated August 1, 2000 announcing that it has completed its acquisition of Los Angeles-based National Genetics Institute, Inc. Terms of the stock purchase transaction were not disclosed.

S I G N A T U R E S Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. LABORATORY CORPORATION OF AMERICA HOLDINGS Registrant By:/s/THOMAS P. MAC MAHON -------------------------------- Thomas P. Mac Mahon Chairman, President and Chief Executive Officer By:/s/WESLEY R. ELINGBURG --------------------------------- Wesley R. Elingburg Executive Vice President, Chief Financial Officer and Treasurer August 14, 2000

EXHIBIT 10.1 FOURTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT FOURTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT, dated as of June 7, 2000 (this "Amendment") among LABORATORY CORPORATION OF AMERICA HOLDINGS, a Delaware corporation (the "Borrower"), the banks, financial institutions and other institutional lenders (the "Banks") listed on the signature pages hereof, and CREDIT SUISSE FIRST BOSTON, as administrative agent (the "Administrative Agent") for the Lenders hereunder. PRELIMINARY STATEMENTS The parties hereto (i) have entered into an Amended and Restated Credit Agreement dated as of March 31, 1997, as amended as of September 30, 1997 and February 25, 1998 and May 7, 1999 (the "Credit Agreement") providing for, among other things, the Lenders to lend to the Borrower up to $1,143,750,000 on the terms and subject to the conditions set forth therein and (ii) desire to amend the Credit Agreement in the manner set forth herein. Each capitalized term used but not defined herein shall have the meaning ascribed thereto in the Credit Agreement. NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements contained herein, the parties hereto hereby agree as follows: ARTICLE I AMENDMENTS; AMENDMENT FEE SECTION 1.01. Amendment to Covenant Prohibiting Stock Repurchases. (a) Section 5.02 (e)(vi) of the Credit Agreement if hereby amended by deleting such subsection and inserting the following in lieu thereof: "(vi) the Borrower may redeem shares of the Borrower Preferred Stock (other than shares owned by Roche Holdings or any affiliate of Roche Holdings) for an aggregate redemption price of not more than $275,000,000 to the extent such Borrower Preferred Stock is not converted into Borrower Common Stock on or prior to (A) July 31, 2000 or (B) if at the time of delivery of the notice of redemption of the Borrower Preferred Stock, the market value of the Borrower Common Stock is at least 200% of the conversion price of $27.50 per share of Borrower Common Stock, September 29, 2000; provided that if a Committed Borrowing is made to provide the funds for such redemption, the Borrower shall have certified, in a duly executed statement to be attached to the Notice of Committed Borrowing delivered to the Administrative Agent in connection with such Borrowing as to the amount of such Committed Borrowing that will be used to pay the redemption price for such Borrower Preferred Stock;" (b) The portion of any Committed Borrowing used for the purpose of redeeming the Borrower Preferred Stock is referred to herein as a "Redemption Advance". The Credit Agreement is hereby further amended to provide that (i) the Applicable Margin for Redemption Advances shall equal the Applicable Margin for Revolving Credit Advances plus the applicable Utilization Margin (as defined below); (ii) the Borrower shall have no right to repay the Redemption Advances unless all other Revolving Credit Advances have been repaid in full and (iii) the Borrower shall have no right to use the proceeds of any Advances for the purpose of repaying any Redemption Advance.

(c) "Utilization Margin" means the applicable amount set forth on the table below: Aggregate Principal Amount of Committed Advances to Finance Redemption of Borrower Preferred Stock Utilization Margin - -------------------------------------- ------------------ Up to $75 million 0% Greater than $75 million and less 0.25% than $150 million $150 million or greater 0.50% SECTION 1.02. Amendment to Acquisition Covenant. Section 5.02 (h) of the Credit Agreement is hereby amended by inserting after "$75,000,000" in subsection 5.02(h)(iii)(A) the following "(or, if Borrower Preferred Stock has converted to at least $200,000,000 of Borrower Common Stock (calculated at the conversion price of $27.50 per share of Borrower Common Stock rather that at the current market value of the Borrower Common Stock), $200,000,000); provided that the aggregate amount used in any year under this Section 5.02 (h)(iii)(A) plus the amount borrowed under this Agreement to fund redemptions of Borrower Preferred Stock permitted under Section 5.02 (e)(vi) and not repaid shall not exceed $275,000,000". SECTION 1.03. Amendment to Debt Covenant. (a) Section 5.02(j) of the Credit Agreement is hereby amended by adding the following new Section 5.02(j)(xiii). "(xiii) the Company's 8.5% Convertible Subordinated Notes due 2012 (as described in the Rights Offering Registration Statement) issued in exchange for the Borrower Series A Preferred Stock in a maximum principal amount of $220,000,000." (b) Such Section 5.02(j) is also amended to make conforming changes in the punctuation by deleting "and" after the semicolon in subsection (xi), and deleting the period at the end of subsection (xii) and inserting "; and" in lieu thereof. SECTION 1.04. Amendment Fee. The effectiveness of this Amendment is subject to the receipt by the Administrative Agent of an amendment fee, payable to the Administrative Agent for ratable distribution to each Lender which has executed this Amendment (each, a "Consenting Lender"), in an amount equal to 0.15% times (A) the aggregate outstanding principal amount of the Committed Advances held by the Consenting Lenders as of the date hereof plus (B) the aggregate unused Revolving Credit Commitments of the Consenting Lenders as of the date hereof. ARTICLE II REPRESENTATIONS AND WARRANTIES SECTION 2.01. Representations and Warranties of the Borrower. The Borrower represents and warrants as follows: (a) The Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. (b) The execution, delivery and performance by the Borrower of this Amendment are within its corporate powers, have been duly authorized by all necessary corporate action, and do not contravene the Borrower's charter or by-laws. (c) No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for the due execution, delivery and performance by the Borrower of this Amendment.

(d) This Amendment has been duly executed and delivered by the Borrower. This Amendment is the legal, valid and binding obligation of the Borrower, enforceable against the Borrower, in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforceability of creditors' rights generally and by general principles of equity. (e) The representations and warranties contained in Section 4.01 of the Credit Agreement are correct in all material aspects on and as of the date hereof, as though made on and as of the date thereof. (f) No event has occurred and is continuing which constitutes a Default. ARTICLE III MISCELLANEOUS SECTION 3.01. Governing Law. This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to the conflicts of law principles thereof. SECTION 3.02. Execution in Counterparts. This Amendment may be executed in any number of counterparts and by any combination of the parties hereto in separate counterparts, each of which counterparts shall be an original and all of which taken together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Amendment by facsimile shall be effective as delivery of a manually executed counterpart of this Amendment. SECTION 3.03. Effect on the Credit Agreement. Upon execution and delivery of this Amendment, each reference in the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein", or words of like import shall mean and be a reference to the Credit Agreement, as amended hereby and each reference to the Credit Agreement in any Loan Document (as defined in the Credit Agreement) shall mean and be a reference to the Credit Agreement, as amended hereby. Except as expressly modified hereby, all of the terms and conditions of the Credit Agreement shall remain unaltered and in full force and effect. This Amendment is subject to the provisions of Section 8.01 of the Credit Agreement.

Each of the undersigned has caused this Amendment to be executed by its respective officer or officers thereunto duly authorized, as of the date first written above. BORROWER: LABORATORY CORPORATION OF AMERICA HOLDINGS By:/s/ WESLEY R. ELINGBURG ----------------------------- Name: Wesley R. Elingburg Title: CFO/EVP/Treasurer ADMINISTRATIVE CREDIT SUISSE FIRST BOSTON, AGENT: as Administrative Agent By: /s/ KARL M. STUDER --------------------- Name: Karl M. Studer Title: Director By: /s/ JULIA P. KINGSBURY ------------------------ Name: Julia P. Kingbury Title: Vice President CREDIT SUISSE FIRST BOSTON By: /s/ KARL M. STRUDER ---------------------- Name: Karl M. Struder Title: Director By: /s/ ROLAND ISLES ---------------------- Name: Roland Isles Title: Associate BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION (As successor by merger to Bank of America Illinois) By: /s/ MARTY V.MITCHELL ------------------------- Name: Marty V. Mitchell Title: Principal BNP PARIBAS (f/k/a BANQUE NATIONALE DE PARIS) By: /s/ BONNIE G. EISENSTAT -------------------------- Name: Bonnie G. Eisenstat Title: Vice President By: /s/ RICHARD PACE ------------------- Name: Richard Pace Title: Vice President Corporate Banking Divisior BAYERISCHE LANDESBANK GIROZENTRALE By: /s/ HEREWARD DRUMMOND ------------------------ Name: Hereward Drummond Title: Senior Vice President By: /s/ ALEXANDER KOHNERT ------------------------ Name: Alexander Kohnert Title: First Vice President THE CHASE MANHATTAN BANK By: /s/ PETER M. HAYES --------------------- Name: Peter M. Hayes Title: Vice President CREDIT LYONNAIS (NEW YORK BRANCH) By: /s/ JOHN C. OBERLE --------------------- Name: John C. Oberle Title: Vice President DEUTSCHE BANK AG NEW YORK BRANCH and/or CAYMAN ISLANDS BRANCH By: /s/ PETER LUDWIG SCHRICKEL -------------------------- Name: Peter Ludwig Schrickel Title: Director By: /s/ STEPHANIE STROHE ---------------------- Name: Stephanie Strohe Title: Associate FIRST UNION NATIONAL BANK By: /s/ ANN M. DODD ------------------ Name: Ann M. Dodd Title: Senior Vice President THE FUJI BANK, LTD. (NEW YORK BRANCH) By: /s/ YUJI TANAKA ------------------ Name: Yuji Tanaka Title: Vice President & Manager SOCIETE GENERALE By: /s/ BETTY BURG ---------------- Name: Betty Burg Title: Director By: /s/ ALEXANDER S. LUDWIG -------------------------- Name: Alexander S. Ludwig Title: Associate THE SUMITOMO BANK, LIMITED (NEW YORK BRANCH) By: /s/ SURESH TATA ------------------ Name: Suresh Tata Title: Senior Vice President WACHOVIA BANK, N.A., formerly known as Wachovia Bank of Georgia, N.A. By: /s/ B. BRANTLEY ECHOLS ------------------------- Name: B. Brantley Echols Title: Senior Vice President WESTDEUTSCHE LANDESBANK GIROZENTRALE By: /s/ RICHARD J. PEARSE ------------------------ Name: Richard J. Pearse Title: Executive Director By: /s/ ELISABETH R. WILDS -------------------------- Name: Elisabeth R. Wilds Title: Manager COMMERZBANK AKTIENGESELLSCHAFT, New York and Grand Cayman branches By: /s/ HARRY P. YERGEY ---------------------- Name: Harry P. Yergey Title: Senior Vice President & Manager By: /s/ SUBASH R. VISWANATHAN ---------------------------- Name: Subash R. Viswanathan Title: Vice President BBL INTERNATIONAL (U.K.) LIMITED By: /s/ G.R.M. WALKER -------------------- Name: G.R.M. Walker Title: Authorised Signatory By: /s/ C.F. WRIGHT ------------------ Name: C.F. Wright Title: Authorised Signatory UBS AG, Stamford Branch By: /s/ HARRY WELTEN -------------------- Name: Harry Welton Title: Director By: /s/ DOROTHY MCKINLEY ----------------------- Name: Dorothy McKinley Title: Director Loan Portfolio Support, US

5 0000920148 LABORATORY CORPORATION OF AMERICA HOLDINGS 1000 6-MOS DEC-31-2000 JAN-01-2000 JUN-30-2000 59,200 0 503,900 131,200 30,600 529,000 527,400 255,000 1,633,300 296,400 412,500 446,000 0 1,800 341,600 1,633,300 945,100 945,100 560,400 560,400 256,000 0 19,800 108,200 49,800 58,400 0 0 0 58,400 1.83 1.71